11.17.2020

Eris Innovations Closes $2m Investment Round

11.17.2020
Basel Committee Consults on Interest-Rate Risk

Eris Innovations, an intellectual property licensing company that partners with global financial exchanges to develop futures products, today announced the successful closing of a $2 million investment round. The announcement follows CME Group’s October 5 launch of Eris SOFR Swap Futures (Eris SOFR), which have averaged more than 3,900 contracts traded per day in November.

Each of the new investors is affiliated with proprietary trading firms committed to make markets in Eris SOFR, including Arb Trading Group, Arclight Securities, Clear Capital Group, DV Trading, Sumo and TransMarket Group. These firms join a group of existing equity holders and affiliates that includes BlueCrest Capital Management, Chicago Trading Company, DRW, Nico Trading, and Virtu Financial.

“DV Trading sees Eris SOFR as an excellent tool for trading short-end rates, where repo market activity, crisis-driven Federal Reserve actions and the imminent adoption of SOFR contribute to near-term trading opportunities,” said Jared Vegosen, Co-Founder of DV Trading. “Our decision to invest in Eris Innovations was a natural extension of our early involvement in trading Eris SOFR.”

Eris SOFR Swap Futures have exceeded the transaction count of OTC SOFR Overnight Index Swaps (OIS) for November month-to-date, according to Clarus Financial Technology data, and account for more than 23% of SOFR swap and swap futures notional value traded in tenors from 1-3 years.

“Eris SOFR addresses the need for additional swap liquidity as market participants look to SOFR as an alternative to Libor,” said Michael Riddle, CEO of Eris Innovations. “Eris SOFR’s initial traction in the 1-, 2- and 3-year tenors is directly attributable to tight markets streamed by these leading futures proprietary trading firms, and this investment further increases their alignment in making Eris SOFR successful.”

Eris SOFR Swap Futures are cash-settled futures contracts that replicate the risk exposure of a standard SOFR OIS transaction, and extend the liquidity of CME Group’s industry-leading SOFR futures complex out to ten years.

Source: Eris

Related articles

  1. The first amendments to the CFTC's swap data reporting rules come into effect on December 5.

  2. CEDX is planning to expand its range of products in 2023, subject to regulatory approvals.

  3. The paper proposes a path forward for standard SLD documentation.

  4. Exchange group’s crypto suite has had consistent volume and open interest growth.

  5. The derivatives venue owned by FTX wanted to offer products that were not fully collateralized.